PayPal's Earnings Miss Expectations, Stock Plummets
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
0mins
Should l Buy PYPL?
Source: NASDAQ.COM
- Earnings Shortfall: PayPal's Q4 2025 earnings report revealed revenue of $6.7 billion and adjusted EPS of $1.23, both falling short of analyst expectations, resulting in a 20.31% stock drop that reflects market concerns over future growth.
- Leadership Change: CEO Alex Chriss's sudden departure, with Enrique Lores taking over, who previously led HP and served on PayPal's Board, may impact the company's strategic direction and investor confidence.
- Surge in Trading Volume: PayPal's trading volume reached 139 million shares, approximately 792% above its three-month average, indicating heightened investor attention and significant market volatility.
- Sector Reassessment: PayPal's weak outlook prompted a reevaluation of the entire payment sector, with rival Fiserv's stock declining by 7.66%, highlighting widespread market concerns regarding payment stocks.
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Analyst Views on PYPL
Wall Street analysts forecast PYPL stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for PYPL is 72.86 USD with a low forecast of 51.00 USD and a high forecast of 100.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
29 Analyst Rating
6 Buy
19 Hold
4 Sell
Hold
Current: 41.700
Low
51.00
Averages
72.86
High
100.00
Current: 41.700
Low
51.00
Averages
72.86
High
100.00
About PYPL
PayPal Holdings, Inc. offers a technology platform. The Company’s products are designed to enable digital payments and simplify commerce experiences for consumers and merchants to make selling, shopping, and sending and receiving money simple, personalized, and secure, online or offline, including mobile. It provides consumers with a digital wallet that enables them to send payments to merchants securely using a variety of funding sources, which include a bank account, a PayPal or Venmo account balance, its consumer credit products, a credit card, a debit card, certain cryptocurrencies, or other stored value products. It operates a global, two-sided network at scale that connects consumers and merchants with 434 million active accounts across approximately 200 markets. Its brands include PayPal, Braintree, Venmo, Xoom, Hyperwallet, PayPal Zettle, PayPal Honey, and Paidy. It offers financing products through the PayPal Working Capital (PPWC) and PayPal Business Loan (PPBL).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
PayPal Under Investigation for Securities Claims Amid Earnings Miss
- Earnings Miss: PayPal's Q4 2025 revenue of $8.68 billion fell short of the $8.80 billion estimate by approximately 1.4%, indicating a significant deviation in financial performance that may undermine investor confidence.
- Analyst Downgrades: Rothschild & Co Redburn and Morgan Stanley both cut PayPal's price target from $70 to $50, reflecting a pessimistic outlook on the company's future growth and exacerbating downward pressure on the stock price.
- Pessimistic Guidance: The company's forward guidance for 2026 indicates a low single-digit decline in transaction margin dollars and adjusted earnings per share, significantly below investor expectations, which could lead to further stock sell-offs and increased volatility.
- Stock Plunge: Following the earnings report, PayPal's shares dropped 19-20% to approximately $42, establishing a new 52-week low, demonstrating extreme market concern over the company's future performance and potential for further selling pressure in the short term.
See More
PayPal Faces Market Share Challenges Amid Analyst Downgrades
- Market Share Decline: JPMorgan highlighted that PayPal struggles to maintain its market share in a competitive landscape, particularly as its higher-margin branded checkout business experiences decelerating growth due to international pressures and weakness in the U.S. retail sector, leading to declining investor confidence.
- Stock Price Plunge: PayPal's shares plummeted over 20% on Tuesday, closing at their lowest level in nearly a decade, marking the eighth consecutive day of losses, reflecting strong market reactions to its disappointing earnings report, with the stock briefly hitting a new 52-week low of $39.96 on Wednesday.
- Analyst Downgrades: Canaccord downgraded PayPal from 'Buy' to 'Hold' with a price target of $42, while JPMorgan lowered its target from $70 to $46, indicating a growing pessimism regarding the company's future growth prospects amid competitive pressures.
- Retail Sentiment Shift: Despite the bearish outlook from analysts, retail investor sentiment improved, with message volumes on Stocktwits surging 40% in the last seven hours, suggesting some investors are anticipating a rebound, even as the overall stock price continues to decline.
See More
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- Boston Scientific Price Target Cut: BTIG lowered Boston Scientific's price target from $132 to $110, which still implies over 45% upside potential, reflecting market confidence in its product lineup despite recent sales misses, particularly in its electrophysiology segment.
- PayPal's Challenges: PayPal's shares fell over 1.6% in regular trading, hitting a new 52-week low of $39.96, as the market reacted negatively to its latest quarterly results and executive changes, although it managed a slight recovery of 0.3% in after-hours trading.
- Market Sentiment Analysis: Despite the challenges faced by Snap and Boston Scientific, investor sentiment on social media remains 'extremely bullish', indicating confidence in long-term growth potential, particularly with the rise in advertising spending during the holiday season.
See More
PayPal Under Investigation for Securities Claims Amid Earnings Miss
- Earnings Miss: PayPal's Q4 2025 revenue of $8.68 billion fell short of the $8.80 billion estimate by approximately 1.4%, indicating a significant gap in the company's outlook management that could undermine investor confidence.
- Analyst Downgrades: Rothschild & Co Redburn and Morgan Stanley both cut PayPal's price target from $70 to $50, reflecting a pessimistic outlook on the company's growth prospects, particularly due to concerns over slowing checkout growth, which may further pressure the stock price.
- Pessimistic Guidance: The company's forward guidance for 2026 indicates a low single-digit decline in transaction margin dollars and adjusted earnings per share, significantly below investor expectations, which could further erode market confidence in PayPal's future performance.
- Stock Volatility: On February 3, 2026, PayPal shares plummeted by 19-20% to around $42, establishing a new 52-week low, reflecting strong market concerns about the company's outlook and potentially facing increased selling pressure in the short term.
See More
PayPal Stock Volatility and Record Trading Volume
- Stock Price Volatility: PayPal's shares dropped over 20% following its earnings report on Tuesday, raising concerns about future performance and potentially impacting investor confidence, leading to short-term price pressure.
- Record Trading Volume: Tuesday's trading volume reached 141 million shares, marking a new high for PayPal, compared to the typical 20 million shares traded daily, indicating possible capitulation from sellers and setting the stage for a potential rebound.
- Seller Capitulation: Investors frustrated by the continuous price decline may decide to sell at lower prices, resulting in high trading volumes, which often signals a market reversal, potentially attracting buyers back into the market.
- Oversold Conditions: PayPal is currently at its most oversold level ever, which could entice buyers to enter the market and drive prices up, as many trading strategies anticipate a reversal based on mean reversion principles.
See More
PayPal Stock Continues Decline Amid CEO Change and Criticism
- Stock Decline Continues: PayPal's stock fell over 2% on Wednesday, adding to a 20% drop on Tuesday due to disappointing earnings and a CEO change, marking the ninth consecutive day of decline since January 22, with an overall drop of nearly 29%.
- Former Executive Critiques Strategy: Former PayPal President David Marcus criticized the company's strategic choices in a social media post, highlighting a pattern of prioritizing predictability over platform risk, which he believes has led to a loss of competitive edge since his departure.
- Leadership Change Raises Concerns: New CEO Enrique Lores, with a hardware background rather than payments, faces skepticism from Marcus regarding his ability to navigate transaction economics and network effects, potentially impacting the company's strategic execution and innovation.
- Market Share Erosion: PayPal has seen a decline in checkout share among its most profitable customers, with recurring issues in lending and buy now/pay later services, indicating significant challenges in a highly competitive payments landscape.
See More
PayPal Under Investigation for Securities Claims Amid Earnings Miss
- Earnings Miss: PayPal's Q4 2025 revenue of $8.68 billion fell short of the $8.80 billion estimate by approximately 1.4%, indicating a significant deviation in financial performance that may undermine investor confidence.
- Analyst Downgrades: Rothschild & Co Redburn and Morgan Stanley both cut PayPal's price target from $70 to $50, reflecting a pessimistic outlook on the company's future growth and exacerbating downward pressure on the stock price.
- Pessimistic Guidance: The company's forward guidance for 2026 indicates a low single-digit decline in transaction margin dollars and adjusted earnings per share, significantly below investor expectations, which could lead to further stock sell-offs and increased volatility.
- Stock Plunge: Following the earnings report, PayPal's shares dropped 19-20% to approximately $42, establishing a new 52-week low, demonstrating extreme market concern over the company's future performance and potential for further selling pressure in the short term.
See More
PayPal Faces Market Share Challenges Amid Analyst Downgrades
- Market Share Decline: JPMorgan highlighted that PayPal struggles to maintain its market share in a competitive landscape, particularly as its higher-margin branded checkout business experiences decelerating growth due to international pressures and weakness in the U.S. retail sector, leading to declining investor confidence.
- Stock Price Plunge: PayPal's shares plummeted over 20% on Tuesday, closing at their lowest level in nearly a decade, marking the eighth consecutive day of losses, reflecting strong market reactions to its disappointing earnings report, with the stock briefly hitting a new 52-week low of $39.96 on Wednesday.
- Analyst Downgrades: Canaccord downgraded PayPal from 'Buy' to 'Hold' with a price target of $42, while JPMorgan lowered its target from $70 to $46, indicating a growing pessimism regarding the company's future growth prospects amid competitive pressures.
- Retail Sentiment Shift: Despite the bearish outlook from analysts, retail investor sentiment improved, with message volumes on Stocktwits surging 40% in the last seven hours, suggesting some investors are anticipating a rebound, even as the overall stock price continues to decline.
See More
Snap Surprises with Earnings Beat; Boston Scientific Faces Price Target Cut
- Snap's Earnings Surprise: Snap reported a surprise quarterly earnings beat driven by increased advertising spending during the holiday season, with its stock falling over 3% in regular trading but rebounding more than 2% in after-hours, indicating investor confidence in its future prospects.
- Boston Scientific Price Target Cut: BTIG lowered Boston Scientific's price target from $132 to $110, which still implies over 45% upside potential, reflecting market confidence in its product lineup despite recent sales misses, particularly in its electrophysiology segment.
- PayPal's Challenges: PayPal's shares fell over 1.6% in regular trading, hitting a new 52-week low of $39.96, as the market reacted negatively to its latest quarterly results and executive changes, although it managed a slight recovery of 0.3% in after-hours trading.
- Market Sentiment Analysis: Despite the challenges faced by Snap and Boston Scientific, investor sentiment on social media remains 'extremely bullish', indicating confidence in long-term growth potential, particularly with the rise in advertising spending during the holiday season.
See More
PayPal Under Investigation for Securities Claims Amid Earnings Miss
- Earnings Miss: PayPal's Q4 2025 revenue of $8.68 billion fell short of the $8.80 billion estimate by approximately 1.4%, indicating a significant gap in the company's outlook management that could undermine investor confidence.
- Analyst Downgrades: Rothschild & Co Redburn and Morgan Stanley both cut PayPal's price target from $70 to $50, reflecting a pessimistic outlook on the company's growth prospects, particularly due to concerns over slowing checkout growth, which may further pressure the stock price.
- Pessimistic Guidance: The company's forward guidance for 2026 indicates a low single-digit decline in transaction margin dollars and adjusted earnings per share, significantly below investor expectations, which could further erode market confidence in PayPal's future performance.
- Stock Volatility: On February 3, 2026, PayPal shares plummeted by 19-20% to around $42, establishing a new 52-week low, reflecting strong market concerns about the company's outlook and potentially facing increased selling pressure in the short term.
See More
PayPal Stock Volatility and Record Trading Volume
- Stock Price Volatility: PayPal's shares dropped over 20% following its earnings report on Tuesday, raising concerns about future performance and potentially impacting investor confidence, leading to short-term price pressure.
- Record Trading Volume: Tuesday's trading volume reached 141 million shares, marking a new high for PayPal, compared to the typical 20 million shares traded daily, indicating possible capitulation from sellers and setting the stage for a potential rebound.
- Seller Capitulation: Investors frustrated by the continuous price decline may decide to sell at lower prices, resulting in high trading volumes, which often signals a market reversal, potentially attracting buyers back into the market.
- Oversold Conditions: PayPal is currently at its most oversold level ever, which could entice buyers to enter the market and drive prices up, as many trading strategies anticipate a reversal based on mean reversion principles.
See More
PayPal Stock Continues Decline Amid CEO Change and Criticism
- Stock Decline Continues: PayPal's stock fell over 2% on Wednesday, adding to a 20% drop on Tuesday due to disappointing earnings and a CEO change, marking the ninth consecutive day of decline since January 22, with an overall drop of nearly 29%.
- Former Executive Critiques Strategy: Former PayPal President David Marcus criticized the company's strategic choices in a social media post, highlighting a pattern of prioritizing predictability over platform risk, which he believes has led to a loss of competitive edge since his departure.
- Leadership Change Raises Concerns: New CEO Enrique Lores, with a hardware background rather than payments, faces skepticism from Marcus regarding his ability to navigate transaction economics and network effects, potentially impacting the company's strategic execution and innovation.
- Market Share Erosion: PayPal has seen a decline in checkout share among its most profitable customers, with recurring issues in lending and buy now/pay later services, indicating significant challenges in a highly competitive payments landscape.
See More
